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When international students are shopping for a student loan, they will find that most loans to attend school in the US require a US-based cosigner. However, for some students, there simply may be no one in their life who can serve as their US cosigner. However, there are strategies that students without US cosigners can use to secure loans for study in the US.
Why do lenders usually require a US cosigner?
Eligibility requirements for international student loans vary from lender to lender but most require a US cosigner. International students pose a greater risk because they lack a US credit history and they may leave the country without paying their loan if they don’t land a job. Lenders may be anxious that international students won’t repay their loan or that it may be hard to collect on the loan if the student moves back to their home country. Hence, lenders need someone who is a permanent resident or a US citizen with good credit standing to guarantee the loan.
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Strategies If You Don’t Have A US Cosigner
If finding a cosigner is not possible, you have other options. Here are some things you can do to be eligible for a loan.
Strategy 1: Show That You Are Financially Responsible
As an international student, your US credit history may be insufficient, but a strong credit history can be useful. Having a credit score in the upper 600s would give you higher chances of becoming eligible for a loan but there are other things you can do to show that you are financially responsible.
Pay your rent, utility bills, credit card bills, and other bills on time
Keep credit card utilization low. If you have a credit card, make sure that the balance does not exceed 30% of your credit limit
Don’t open too many credit card accounts at the same time. Applying for too many credit lines make lenders think you are scrambling for cash
Explore Nova Credit which helps you bring your international credit history to the US
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Strategy 2: Secure Employment or an Offer of Employment from a Stable Company Prior To Applying For the Loan
Lenders may consider international student loan applicants if you are currently employed in the US or if you have a job offer at a stable US or global company. Lenders may assess your job stability based on who your employer is and how easy it is to find a job in your profession.
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Strategy 3: Research Certain Lenders Who Serve International Students
International students have limited options but there are lenders who specialize in financing the education of foreigners. Here are some of them.
Offers student loans to international working graduates enrolled in a top master’s program.
Residence in the UK or in one of these US states: AK, CO, DC, FL, GA, IL, KS, KY, MD, NE, NH, NJ, NM, NY, NC, OK, OR, PA, SC, TN, TX, UT, VA, WI.
F1-OPT, H1B, L1 and O-1 visa and other valid visa types for international students
Proof of admission to a school and program supported by Prodigy
Interest rates: Starts at 8.50% APR but maximum APR will not exceed 25%.
Payment starts: Six months after graduation
Learn more here: https://prodigyfinance.com/get-a-loan
Offers international student loans to students attending certain partner universities
Valid passport with photo
F-1, J-1 or H-1B visa
Form 1-94 Arrival/Departure Record
DS-2019 Certificate of Eligibility for J-1 visa holders
Letter from employer confirming employment for H-1B visa holders
Interest rates: 8.50% and 9.50% APR
Payment starts immediately or may be deferred six months after graduation, but you’ll have to pay the interest portion of the loan
Learn more here: https://www.quorumfcu.org
Serves as a peer to peer platform connecting borrowers to lenders
Minimum age of 18 years old
Proof of citizenship or legal US residency
Proof of income
Home and work telephone numbers
Valid email address
Checking account under your name
Interest rates: 5.99 to 35.99%
Payment terms vary by lender
Learn more here: https://www.badcreditloans.com
Offers personal loans to non-citizens
Focuses on borrowers with credit scores between 600 and 700
Income considered is usually between $40K to $100K
Interest rates: Varies by state but usually between 9.95% to 35.99%
Payment starts about 30 days from the issuance of the funds
Learn more here: https://www.avant.com
Offers international student loans and offers interest rate discounts for qualified loans
Enrolled in an MPower supported school in the US or Canada
Resides in the country where you are studying
A degree-seeking student within two years of graduating from the program.
Interest rates: Between 8.89% to 14.97%
Payment starts 45 days after the loan is disbursed. Students make interest-only payments until six months after graduation before regular monthly payments begin
Learn more here: https://www.mpowerfinancing.com/
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